Bawumia’s  comprehensive tolling policy: A deep dive into its feasibility and equity

Getting your Trinity Audio player ready...

Ghana’s road infrastructure has long been a topic of public discourse, with concerns about its maintenance and expansion being a recurring theme.

The cessation of toll collection on public roads in 2021 left a significant revenue gap, raising questions about sustainable road construction and maintenance funding models.

As Ghana grapples with a widening road infrastructure gap, estimated to require approximately $9 billion annually over the next two decades, Vice President Dr Mahamudu Bawumia has supported Amin-Adam, the finance minister’s announcement of the reintroduction of tolling, but this time with a broad-based approach. 

The idea is to create a more inclusive and equitable system that could potentially solve Ghana’s revenue challenges while ensuring fairness in the distribution of the financial burden.

However, the feasibility of such a broad-based tolling system is not without controversy. Ghana’s road network architecture, characterised by alternative routes that circumvent toll booths, raises doubts about the practicality of implementing a system that could comprehensively cover all road users. 

Moreover, the question of fairness looms large, as the socio-economic disparities across different regions could lead to unequal impacts, further exacerbating existing inequalities.

Could Dr Bawumia’s proposal answer Ghana’s road infrastructure woes? What were the fundamental flaws in the previous tolling system led to its downfall? Can a more inclusive tolling approach be the key to unlocking the potential benefits for all Ghanaians? What challenges might stand in the way of this broad-based tolling system? Will this proposal address the nation’s revenue needs while promoting fair road usage?

The current landscape of Ghana’s road network

Ghana’s road network is a crucial component of its economic infrastructure, facilitating trade, commuting, and overall connectivity. However, the existing system has faced numerous challenges, including poor maintenance, inadequate funding, and significant disparities in road quality between urban and rural areas. The abolition of tolls in 2021 was a populist move aimed at reducing the financial burden on everyday Ghanaians. Still, it also removed a vital revenue stream earmarked for road maintenance.

The absence of tolls has left the government heavily reliant on budget allocations for road projects, a funding source increasingly stretched thin amidst competing demands. 

With the projected road infrastructure gap requiring an estimated $200 billion over the next 23 years, the need for a sustainable revenue model has never been more urgent.

What is a Broad-Based Tolling System, and how feasible is it?

Dr Bawumia’s proposal of a broad-based road-tolling system means ensuring equity in Ghana’s road infrastructure funding. Dr Bawumia pointed out that under the existing system, residents of affluent neighbourhoods such as Cantonments, East Legon, and Ridge are unlikely to encounter tolls. At the same time, those in areas like Kasoa are more frequently subjected to them. This creates an inequitable situation where a significant portion of the population is not contributing to road maintenance and development. By introducing a broader tolling system, the Vice President aims to distribute the financial responsibility more evenly across all regions, ensuring that all citizens contribute fairly.

Dr Bawumia’s proposal for a broad-based tolling system seeks to reintroduce tolls more comprehensively and equitably. The idea is to ensure that all road users, regardless of their socio-economic status, contribute to the upkeep of the nation’s road network. However, the feasibility of this approach is questionable, given the current road network architecture.

Fred Awutey, a tax consultant, highlights a critical flaw in the broad-based tolling system: the presence of alternative routes that allow wealthier individuals to bypass toll booths. 

“Our road network and the architecture do not allow that because most of whom you notice, the rich or those who are deemed to be of high-level income, live in a central area where there are alternative roads and road toll becomes ineffective if you have an alternative road. So once the person has an alternative road, he may not be using the road which is tolledhe. So based on that, it will be difficult for a broad-based implementation of this.”

Multiple road options make tolling ineffective in many urban areas, particularly in the central regions where higher-income individuals reside. 

If road users can easily avoid tolls by choosing alternative routes, the broad-based system may fail to generate the expected revenue, rendering it ineffective.

Furthermore, Ghana’s current road network does not support a seamless tolling system. Many roads are in disrepair, and the lack of alternative routes in rural areas could disproportionately affect low-income individuals who have no choice but to use toll roads. 

This raises concerns about the equity of a broad-based tolling system, as it could inadvertently place a heavier financial burden on those already economically disadvantaged. 

Addressing Revenue Challenges

The proposal to reintroduce tolls is part of a broader conversation about funding Ghana’s road infrastructure without overburdening the national budget. As Kofi Tonto, a political aide to Dr Bawumia, notes, the government is exploring various options to move away from budgetary allocations for road construction. 

The sheer scale of the funding required—$9 billion annually—makes it clear that traditional funding methods are insufficient.

“The whole discussion centred on funding for road construction. When the finance minister was speaking, he said that in the next 23 years, we would need, I think, about 200 billion or roughly about $9 billion a year if we are to close the road infrastructure gap. It will be very difficult for the government to put $9 billion annually on the budget for road construction.”

A broad-based tolling system could theoretically provide a steady stream of revenue for road maintenance and expansion, but its success hinges on effective implementation. The system must be designed to minimise evasion, perhaps through technology such as electronic tolling and GPS tracking. 

Additionally, considerations must be made to ensure that the system does not disproportionately affect certain segments of the population, particularly those in rural areas with limited access to alternative routes.

Promoting fairness

One key argument in favour of a broad-based tolling system is its potential to promote fairness in revenue generation. By ensuring that all road users contribute to maintaining the infrastructure they utilise, the system could distribute the financial burden more equitably. However, this ideal outcome is contingent upon addressing the existing disparities in the road network and ensuring that the tolling system does not exacerbate inequality.

For instance, differential toll rates based on vehicle type, income level, or road usage patterns could be introduced to mitigate the impact on lower-income individuals. Additionally, tolls could be reinvested in improving rural roads, enhancing connectivity and promoting regional development.

A bold attempt to address Ghana’s road infrastructure challenges? 

Vice President Dr Bawumia’s proposal for a broad-based tolling system represents a bold attempt to address Ghana’s road infrastructure challenges. 

While the idea holds promise to generate much-needed revenue and promote fairness, its feasibility is far from guaranteed. The success of such a system would require careful consideration of Ghana’s road network architecture, the socio-economic disparities among its users, and the implementation of measures to ensure that the system is both effective and equitable.

As the nation continues to debate the best path forward, it is clear that any solution must balance the need for revenue generation with the imperative of social justice. Whether a broad-based tolling system can achieve this balance remains to be seen, but it is a conversation that Ghana must engage in with both caution and creativity.

Our fellow produced this explainer as part of the requirements of the DUBAWA 2024 Kwame KariKari Fellowship in partnership with Asaase Radio, Ghana.